Dispute settlement clauses need not ‘settle’ disputes

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Dispute settlement clauses need not ‘settle’ disputes

While all Federal certified agreements must contain dispute settlement clauses, such clauses need not necessarily provide mechanisms which settle disputes.

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While all Federal certified agreements must contain dispute settlement clauses, such clauses need not necessarily provide mechanisms which settle disputes.

The parties to this matter were seeking to have certified a number of agreements under the Workplace Relations Act 1996.

In conciliation, Commissioner Bacon expressed his doubt as to whether the dispute resolution clauses in the agreements were capable of actually resolving the disputes since they only gave the Commission powers of conciliation and not arbitration.

For this reason, the Commissioner queried whether the agreements met the requirements of the Act(as per s170LT) which provide that a dispute resolution clause (which is mandatory) must provide procedures for ‘preventing and settling’ disputes arising under the agreement.

The parties submitted that the words ‘prevent’ and ‘settle’ should not be seen as separate words, because if the clause actually ‘prevented’ all disputes then there would be nothing left to ‘settle’.

For this reason, the parties submitted that the proper approach was to consider ‘prevent and settle’ as a phrase, and that phrase needs to be considered in the context within which it appears in the Act.

Commissioner Bacon thereupon examined other parts of the Actwhich use this phrase and held that those provisions provide that a dispute, although subject to procedures for ‘prevention or settlement’, may not necessarily resolve a dispute (see for example s91and s170VG).

For these reasons, Commission Bacon held that a dispute resolution procedure which does not necessarily settle all disputes arising under the agreement can still be certified (ANI Bradken v AFMEPKIU; Print P1035 [1997] 508 IRCommA).

 

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